Minimum notice period under section 148A(b) invalidated where less than seven days granted, nullifying subsequent reassessment.

Section 148A(b) prescribes a mandatory minimum seven-day period to file objections to a notice to show cause; a notice granting fewer days is invalid. The impugned notice dated 18/03/2023 gave only four days and therefore did not satisfy the procedural protection under section 148A(b), rendering the subsequent order under section 148A(d), the notice under section 148 and the assessment under section 147 vitiated. The invalidity of the initial notice leads to setting aside the reassessment proceedings and the appeal succeeds for the assessee.

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Issues: (i) Whether the notice issued under section 148A(b) of the Income-tax Act, 1961 which granted less than the statutory minimum period of seven days for filing objections is invalid and, if so, whether the subsequent proceedings under sections 148A(d), 148 and assessment under section 147 are liable to be set aside.

Analysis: Section 148A(b) of the Income-tax Act, 1961 prescribes that the assessing officer shall serve a notice to show cause within such time being not less than seven days but not exceeding thirty days from the date on which such notice is issued. The notice dated 18/03/2023 granted time only up to 22/03/2023, i.e., four days, thereby failing to meet the statutory minimum. The requirement of a minimum seven-day period is mandatory for the opportunity of being heard under section 148A(b). A jurisdictional High Court Division Bench has held that non-compliance with the minimum seven-day requirement renders the 148A(b) notice contrary to law. Where a prerequisite procedural protection is not provided as mandated by section 148A(b), the subsequent order under section 148A(d), the notice under section 148 and the assessment order under section 147 follow from and are vitiated by that illegality.

Conclusion: The notice issued under section 148A(b) of the Income-tax Act, 1961 dated 18/03/2023 is invalid for failing to provide the statutory minimum period of seven days; consequently the subsequent proceedings under sections 148A(d), 148 and the assessment under section 147 are set aside and the appeal is allowed in favour of the assessee.

Ratio Decidendi: Where section 148A(b) of the Income-tax Act, 1961 prescribes a mandatory minimum period of seven days to respond to a notice to show cause, any notice giving less than seven days is invalid and renders subsequent reassessment proceedings under sections 148A(d), 148 and 147 liable to be set aside.

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